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Top Tips

What to do when debt worries impact on performance at work

Wellbeing in the workplace is a hot topic with more companies recognising the need for a healthy work environment. But what if money problems are causing you added stress outside of work? We explain what to do when debt impacts your work performance.

One in four people are affected by a mental health condition, and, of these close to nearly half will struggle financially. Also, a further four million people are at risk of developing a mental illness as a direct result of their financial situation.

Money worries are a leading source of stress - 50% of UK adults who are in debt also experience mental health problems – so it’s understandable to see how your financial situation could impact your performance at work.

The links between financial and mental wellbeing

Definitions of financial and mental wellbeing vary, but there are similarities between the two. If you’re ‘well’ both mentally and financially, you are free to do the things you want to, and in a position to cope with unexpected situations.

“…a feeling that you can do the things you want to do... Of course, good mental wellbeing does not mean that you never experience feelings or situations that you find difficult, but it does mean that you feel you have the resilience to cope when times are tougher than usual.” Sarah Stewart-Brown, professor of public health at the University of Warwick and a wellbeing expert
Financial wellbeing “a state of being wherein you: Have control over day-to-day, month-to-month finances, have the capacity to absorb a financial shock, are on track to meet your financial goals, and have the financial freedom to make the choices that allow you to enjoy life.” Consumer Financial Protection Bureau (CFPB), Financial well-being: The goal of financial education.

What can I do if I’m stressed about money?

If you’re stressed about your money situation, there are several things you should do to help yourself both financially and mentally.

Complete a budget sheet

Complete an income and expenditure budget sheet, which allows you to see precisely what you have coming in and going out each month.

Use the free Budget Planner on our website which puts you in control of your household spending and analyses your results to help you take control of your money.

Get free, impartial debt advice

If you’ve completed your budget sheet and noticed you are spending more than you receive, then you should seek free independent debt advice from organisations such as National Debtline, Stepchange or PayPlan.

Understand what bills to prioritise when in debt

You should always prioritise debts that impact your life directly. Always try to keep up payments on the following:

  • Rent or mortgage on your house
  • Electric and gas bills
  • Council tax
  • Payments on a car
  • Food shopping

If the following payment commitments aren't secured against you in any way, you should prioritise these repayments last:

  • Credit cards - can only affect your credit rating
  • Loans - can only change your credit rating
  • Water bill - by law you can’t be cut off from your water supply

Speak to your employer about your money worries

If you’re worried about your finances and it’s affecting your work, you should speak to your employer.

Your employer may offer a loan scheme where the monthly repayments are taken directly from your wages – these are often at a lower interest rate than payday lenders.

Many organisations also have Employee Assistance Programmes (EAPs). Find out if you can talk to them about how your finances are impacting your mental wellbeing.

Save something each month if you can

Unexpected situations like a wage drop, large utility bill or a broken washing machine can have an impact on your stress levels.

Saving money each month can ensure you are more resilient to unexpected financial commitments. Banks such as Monzo allow you to set up saving pots. They also have a ‘piggy bank pot’ which rounds up the pence on each transaction you make and puts it into a savings pot.

Your employer may offer a savings scheme where money can be taken directly from your wages each month and put into a saving plan.

What can I do if I’m worried about an employee’s financial situation?

As an employer, you have the power to make a significant impact on your staff. If you are worried a member of your team is stressed about money, there are a few things you can do.

Talk to your employee

If you notice a staff member is not performing as usual, it’s worth asking them sensitively if anything is wrong, and that includes trying to find out whether money problems are the root cause.

Offer payroll savings and loans

You can investigate savings and loan schemes - managed through payroll – which are offered by credit unions or private organisations, like Salary Finance.

Signpost to free, impartial advice and information

Make sure your staff know if you have an Employee Assistance Programme. You should also signpost staff to free, unbiased sources of help, such as the Mental Health & Money Advice website.

PayPlan has also produced a toolkit aimed at employers to help them promote financial wellbeing in the workplace.

Top tips and advice

  1. Why the Mental Health and Money Advice service is helping people with mental illness and money issues
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  5. Budget 2023: How does it affect you?
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  7. Let’s Get Talking about Student Mental Health: University Mental Health Day
  8. How to save money this Christmas and New Year’s
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  11. Blue Badges available for people suffering from mental illness
  12. Budget 2018: How does it affect you?
  13. What the 2018 PIP ruling means for those living with mental health issues
  14. Mental health and Money Advice responds to Goverment’s proposed Breathing Space scheme
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  18. FCA announces new rules on 'buy now pay later' products and overdrafts
  19. Mental health and money advice for COVID-19 outbreak
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  21. How the Touco app can help you get support around money and mental health
  22. How banks are helping during the Coronavirus period
  23. DWP publishes mental health conditions for PIP back payments
  24. Managing your mental health and money after government cuts
  25. Universal Credit boost for mental health
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  27. Tips for managing your money and mental health in 2022
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  34. What does the Autumn Statement 2023 mean for you?
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